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For Release — Tuesday, December
19, 2006

New
Business Council survey:
NEW YORK STATE EMPLOYERS SAY HEALTH-INSURANCE COSTS AND COSTS OF
WORKERS' COMP, ENERGY, AND BUSINESS TAXES ARE THEIR TOP POLICY CONCERNS

ALBANY—New York State employers responding to a Business Council
survey have overwhelmingly identified employee health care as their top
cost-of-doing-business concern. The new survey also showed strong employer
concern about costs of workers' compensation, energy, and business taxes.

Kenneth Adams, President and CEO of the Council, said the findings will
determine the priorities the Council will work on with the new Governor
and Legislature in 2007.

The survey, which the Council conducted in November and December, asked
individuals at member employers to rank various public-policy issues within
each of three areas: cost-of-doing business issues; economic development
issues; and governmental reform issues.

The Council received some 1,080 responses, which is nearly twice the
number of respondents from any previous Council survey of its members.
The returns were broadly representative of the Council's membership in
terms of size, type of business and location, and cross-tabulations found
that the issue rankings were broadly consistent regardless of the size
or type of company represented in responses.

"We have a mandate because of a high level of response," Adams
said. "And because we asked our members to rate things and make tough
choices on their recommendations for what we do, I think we have a very
clear direction. So not only do we have a mandate, but we have clarity,
too."

Cost-of-doing-business issues

Members reported that cost-of-doing business issues were far and away
the most important advocacy area for them. Almost two-thirds of members
said this was the most important area on which The Business Council should
concentrate, and 80 percent said it was one of the top two. Economic development
issues were next, followed by governmental reform issues.

Health care: Thirty percent of respondents said health
insurance for themselves or their employees was their top cost-of-doing-business
concern, and more than 65 percent of respondents ranked health insurance
as one of their top four issues.

"Hidden taxes (surcharges) on health insurance and health care
are passed on to businesses of this state, thereby increasing their
overall tax burden and increasing their cost for health coverage,"
one respondent wrote in the comments portion of the survey. "Benefit
mandates for health insurance also increase insurance premiums, and
add to the overall cost of providing business-based health insurance.
All of these mandates are implemented without regard to what effect
they have on outcomes, quality of care, overall cost health care."

Workers’ compensation: About 16 percent of those
who took the survey said workers’ compensation assessments and
premiums are the single most important cost-of-doing-business issue.
And more than 54 percent rated comp as one of their top four. The Council
has been working closely with the new Spitzer administration, and the
state AFL-CIO, to produce a compromise reform plan for workers' comp.

"Please continue to fight for reform of the workers' compensation
system!" one respondent wrote The Business Council. Many other
companies reiterated in open-ended portions of the survey that they
are concerned about comp; one company specified that the lack of a limit
on permanent partial disability benefits had a significant impact on
its bottom line.

Energy costs: Energy costs were rated by 9.5 percent
of respondents as their number one cost-of-doing business issue. Over
41 percent of respondents ranked the issue in the top four.

New York's state taxes on business: More than 40 percent
of respondents ranked New York State taxes on business as one of their
top four cost issues.

"Government must find ways to make companies stay in NY whether
by reducing taxes or other major incentives and there shouldn't have
to be restrictions - it should be available for all companies,"
one respondent wrote.

"Just lower the cost of government in NY and taxes will decrease
and businesses will prosper," another respondent said.

Liability insurance and lawsuits: More than 40 percent
said the issue was in their top four.

Economic development

The top three issues selected by members as the most important under
economic development were:

Economic development programs and incentives: One
out of every five members listed economic development programs and incentives
as their top economic development priority. Nearly half ranked economic-development
programs within their top four priorities in this category.

"Economic development reform needs to include a new model, with
more collaboration with regions and effective regional partnerships,"
one respondent said.

"The Empire Zone Program is a bureaucratic nightmare of paperwork
and confusion," another respondent said. "How about developing
a simplified economic development tax credit incentive program for all
businesses who make capital investments and create jobs?"

Workforce development and training: Some 47 percent
of respondents said worker training and enhancement was one of their
top four concerns in this area.

"Trade skills are disappearing," one respondent said. Another
company said it was having problems "finding good workers with
vocational skills."

Innovation, science and technology: More than a quarter
ranked innovation, science and technology as one of their top four economic
development issues.

Some respondents said red tape and regulation stifled the state’s
technological growth. "Price controls on the biotechnology and
pharmaceutical sector in New York State have the greatest negative impact
on innovation and job growth in NYS," one respondent remarked.

Government reform

Consolidation of local government or local government services:
Nearly 28 percent of respondents selected consolidation of local governments
or local government services as their top reform priority. Almost half
said it was one of their top two concerns.

Governmental debt and public authority reform: More
than 43 percent said this was one of their top two reform issues.

"New York State's organization is inefficient and bloated,"
one respondent said. "There needs to be an effort to streamline
administration. Our organization has seen unit price increases at half
the rate of inflation for 20 years, and we have prospered through productivity
improvements. This needs to be applied to state and local governments.
The political choice is not only higher taxes or lower services, but
lower governmental costs per unit of service."